1 Client Brief and Recommendation

Client Name = WestPakAvocado

Client Linkedin = https://www.linkedin.com/company/west-pak-avocado-inc-/

Request Date= 28/10/2022

Recommendation = WestPakAvocado a organic avocado distributor in the US, has requested a report to monitor New Orlean/ Mobile Hass organic avocado market. Distributors should pay attention on price gap of organic and conventional price, see the timeline trend, and product trend.

Word Count = 393

2 Primary Investigation

in 2019, Hass Avocado Board has released a market opportunity matrix that indicates New Orleans to have a strong potrential of growing and development strategy that needs to be address selectively. Henceforth, this report will focus on analyzing and showing the New Orlean’s market trend to support market development for WestPakAvocado.

2.1 Dataset Overview

Source

The data used in this analysis was downloaded from the Hass Avocado Board website, which compiles the sales of avocado from 2015-to may 2018.

Data cleaning

The original data accumulates the progress in the USA overall, however for the sake of analysing only New Orleans this report has been filtered.

2.2 Initial Data Analysis

# Load packages
library(tidyverse)
library(dplyr)
library(ggplot2)
#quick look at the top 5 row
avocado %>% filter(region=="NewOrleansMobile",type=="organic") %>% arrange(AveragePrice) %>% slice_head(n=5)
##         Date year   month week AveragePrice Total.Volume X4046 X4225 X4770
## 1 18/01/2015 2015 January    3         0.98         4739   256     2     0
## 2 30/08/2015 2015  August   34         1.08         4600   206   136     0
## 3 03/07/2016 2016    July   29         1.18         3290   421    11     0
## 4 06/08/2017 2017  August   34         1.18         6994   128    71     0
## 5 13/08/2017 2017  August   34         1.20         8220   164    93     0
##   Total.Bags Small.Bags Large.Bags XLarge.Bags    type           region
## 1       4480       4480          0           0 organic NewOrleansMobile
## 2       4257       4257          0           0 organic NewOrleansMobile
## 3       2857       2830         26           0 organic NewOrleansMobile
## 4       6794       6781         13           0 organic NewOrleansMobile
## 5       7962       7945         16           0 organic NewOrleansMobile

2.2.1 Size,Classification, Variable

dim(avocado)
## [1] 18249    15
Variable Name Meaning Format
Date date of observation chr
year year of observation chr
month month of observation chr
week week of observation chr
AveragePrice average price of a single avocado num
Total.Volume total numbers of avocado sold num
X4046 Total of code 4046 avocado sold (small) int
X4225 Total of code 4225 avocado sold (Large) int
X4770 Total code 4770 sold (all size) int
Total.Bags Total numbers of bag sold int
Small.Bags Total numbers of small bag sold int
Large.Bags Total numbers of Large bag sold int
XLarge.Bags Total numbers of XL bag sold int
type growing method (conventional/organic) chr

3 Research Conduct

3.1 Organic Avocado quantitative trend in New Orleans From 2015 to 2018

3.1.1 Total Volume Sold in the First 13 Weeks (2015 to 2018)

avocado  %>% 
  filter(region == "NewOrleansMobile", type=="organic", year== "2015":"2017") %>% 
  group_by(year) %>% 
  summarise(grand_total_volume = (sum(Total.Volume))) %>% 
  ggplot(aes(x = year,
             y = grand_total_volume,
             group = year,
             fill = grand_total_volume)) +
  geom_col() +
  scale_y_continuous() +
  scale_fill_viridis_c(begin = 0.45, end = 0.55) +
  labs(title = "organic Hass Avocado Unit Sales (comparison from the first 13 week) ",
       subtitle = "New Orleans Mobile (2015 to 2017)",
       x = "",
       y = "Units sold") +
  guides(fill = "none")

Organic sales in general has been increasing, 2018 data is filtered because it hasn’t collect a full year worth of data.

3.1.2 What is The Relation Between Conventional prices and Organic price

The next graph will inspect the relation between conventional pricing and organic pricing

library(plotly)
THEORGANIC = avocado %>% filter (region=="NewOrleansMobile") %>% filter(type=="organic") %>% mutate (revenue=AveragePrice*Total.Volume)
THECONVENTIONAl = avocado %>% filter (region=="NewOrleansMobile",type=="conventional")  %>% mutate (revenue=AveragePrice*Total.Volume)

combined = cbind(o_p = THEORGANIC$AveragePrice, c_p = THECONVENTIONAl$AveragePrice, o_v= THEORGANIC$Total.Volume) 
combined= as.data.frame(combined) %>% mutate(pd= o_p-c_p)

scp = ggplot(combined, aes(x = pd,y = o_v))+geom_point(color="dark green")+geom_smooth(method = "lm") + ggtitle("Total Sales against price difference of organic and conventional avocado",subtitle = "New Orleans Mobile (2015-2018(May))") + labs(x="average price gap ($) ", y="Volume Sales") 
ggplotly(scp)

Further Test with Regression test

The Regression test gives : y= 5722.6−4576.1X For H0: β1=0, and has a p-value= 5.07×10−15.

the function implies that there is a negative linear relationship, a gap of one dollar will reduce sales by 4576 avocado. Meaning, when the price gap is bigger sales volume goes down.

3.1.3 Summary

-Organic consumption has gone up which indicates that it is growing in popularity and market at New Orleans/Mobile.

-based on the graph and regression test, organic avocado sales is highly influenced by the price different between conventional and organic.

3.2 Identifying crucial marketing strategy and consumer preference

3.2.1 Trajectory of Avocado sales over time

Hass Avocado promotions within the united states has achieved rapid increase per capita consumption in the past few year by implementing economic strategy within local market areas (Carmen et al., 2017) therefore identifying crucial time is important.

library (plotly)
scatter.plot <- avocado %>% filter (region == "NewOrleansMobile",type=="organic") %>% mutate(revenue= AveragePrice*Total.Volume) %>% ggplot(aes(x=week ,y=Total.Volume, group=year, color=year))+geom_point()+scale_y_continuous()+scale_color_viridis_d(begin = 0.45, end = 1) + labs(title = "Avocado volume (consumption) in New Orleans Mobile overtime",
       subtitle = "New Orleans/Mobile (2015 to 2018 (May))",
       caption = "Source: Hass Avocado Board",
       x = "",
       y = "Organic Avocado Volume",
       color = "") + facet_wrap(.~year)+theme(text=element_text(size=10))
ggplotly(scatter.plot)

the trend line indicates that over time the total volumes of avocado sold has increased by 2018,in the US specific events influence the consumption of avocado (Mohammad, 2021), with it peaking on : - Superbowl on february

  • cinco de mayo which usually impacts consumption does not lead to huge spikes because the demographic in New Orleans is predominantly African america/black.

  • generally sales goes down from November to December, notably thanks giving and Christmas holidays still led to small spikes

3.2.2 Product specific analysis

avocado %>% filter (type=="organic", region== "NewOrleansMobile",year=="2015":"2017") %>% group_by(year) %>% summarise (total4046=sum(X4046),total4225=sum(X4225), total4770=sum(X4770))%>% pivot_longer(cols=total4046:total4770,names_to="plu",values_to="pluvolume")%>% mutate(plu=case_when(plu=="total4046"~"4046(small)",plu=="total4225"~"4225(large)",plu=="total4770"~"4770(mix)")) %>% ggplot(aes(x=year,y=pluvolume,fill=plu))+geom_col(position="dodge")+scale_y_continuous()+scale_fill_viridis_d(begin = 0.45, end = 1) +labs(title = "Organic Hass Avocado Unit Sales by PLU",subtitle = "New Orleans/Mobile (2015 to 2017)",  x = "", y = "Units sold",fill = "")

small avocado is favored by consumers in New Orleans/Mobiles

3.2.3 limitation

  1. the avocado trendline does not explain other crucial variable that factors such as seasonal harvest and price changes therefore further research to identify other contributing variable is recommended.

3.2.4 Summary

  1. Marketing strategy should take account on important celebratory event
  2. Small Avocado is favored in New Orleans/Mobile

4 Acknowledgments

Ambrozek, C., L, T., & sexton, S. R. J. (2018, November 5). Five-Year Evaluation of The Hass Avocado Board’s Promotion Programs: 2013 – 2017. hassavocadoboard.com. https://hassavocadoboard.com/wp-content/uploads/2019/03/hab-latest-independent-economic-evaluation-2018.pdf

Hab 2019 market opportunity matrix. (2019). hassavocadoboard.com. https://hassavocadoboard.com/wp-content/uploads/hab-2019-market-opportunity-matrix.pdf

Mohammad, S. (2021, December 14). Hass Avocado Data Analysis for the years 2015–2020 — Part 1. Medium. https://medium.com/@msajida333/hass-avocado-data-analysis-for-the-years-2015-2020-part-1-e53b81d3b4f2

producemarketguide.com. (n.d.). Retrieved October 27, 2022, from https://www.producemarketguide.com/produce/organic-avocados

5 appendix

I decide my client to be WestPakAvocado that distributes organic avocado, thus the content of my report focuses on organic avocado side of the data. WestPakAvocado distributes to all countries in the US, thus I decided to search the Hass Avocado Board matrix to see which area needs further marketing aid an one of them was New Orleans/Mobile. My statistical analysis is mostly qualitative, because I want to focus on helping marketing strategy, the numerical analysis is done through linear modelling to identify whether price gap between organic and conventional avocado would influence the sales volume.